2. To succeed as a VC, you have to do three things really well: source, pick,
and win" (Andreessen Horowitz case, p. 8). What does a traditional VC firm do
to source, pick and win? How does a16z approach these key success factors
differently than other VC firms?
Traditional VC firms do either of two things: Being outside lurking for average looking
companies as well following the stars and two, leverage on their strong brand and just sit
and see the parade. For Picking, they mainly go for companies with not so many
weaknesses even though they may not have many strengths. a16z, instead focus on the
strengths and just keep an eye in weaknesses. And for winning, traditional VCs, throw
money and a lot of empty promises but a16z instead, gest picked by the entrepreneurs
by all the real things it has to offer: the operational advisory and their big networks.
Cost
Average annual cash compensation per non-GP employee=$130,000
Non GP employees needed= 100
Cost/yr of non GP employees= $1,300,000